• WAREHOUSE FIRE IN HANOI DEMONSTRATES THE NEED FOR SUSTAINABLE PRACTICES IN THE SUPPLY CHAIN

    08 November 2019

    On August 28 at 18:00 local time, a fire broke out at the warehouse facility of Rang Dong Light Source and Vacuum Flask JSC, a producer of lighting products and equipment in Hanoi. The fire continued for approximately 5 hours and ultimately destroyed one-third of the inventory that was stored at the 6000m2 facility.

    The damaged inventory included 480,000 light bulbs containing 20mg of liquid mercury per bulb, 1.6 million Compact Fluorescent Lamp (CFL) bulbs with roughly 9mg of amalgam tablets (consisting of 22% to 30% mercury) per bulb, and 2 million bulbs with unspecified quantities of tungsten filaments, in addition to several other materials that can be toxic to humans. Losses from the fire are estimated by Rang Dong to be VND 150 billion (USD 6.4 million; EUR 5.9 million). In total, the Vietnam Environment Administration estimated on September 8 that 15.2kg-27.2kg of mercury was released into the atmosphere as a result of the fire.

    Located in the Ha Dinh Ward of Thanh Xuan District in south-central Hanoi, the facility is situated in an area that gradually developed to become a high-density residential neighborhood as the city expanded over time. A day after the fire on August 29, the Ha Dinh Ward People’s Committee, which functions as the local governing body, issued a notice warning people not to consume any food or water processed or handled within 1 kilometer of the factory for a period of 21 days. Further, an environmental expert warned that winds may have spread the pollution to 2 nearby primary schools and a water treatment plant.

    However, the statement was retracted by the Committee on August 30, while the superior People’s Committee of Thanh Xuan District commented that the statement had been issued “without rightful authorization” and with “insufficient evidence.” Later on the same day, the People’s Committee of Thanh Xuan District claimed that test results from the Institute of Occupational Health and Environment confirmed that mercury, lead, heavy metals, microclimate, and dust indicators were all found to be in safe ranges. In response, the director of the institute stated to the press that no test results had yet been obtained, and that when available, they would only be published by the institute directly.

    Supply chain managers should mindful of the current circumstances characterizing environmental protections and public crisis management in Vietnam. In order to mitigate operational risks, supply chain managers should first ensure that the exact locations of all suppliers in Vietnam are properly documented. Next, audit suppliers to ensure that they (particularly hazardous-material handlers) are effectively self-regulating to international safety standards. This will not only minimize the risk of supply disruptions, but may also protect against potential reputational losses in case a supplier becomes associated with negligence or public harm.

    Finally, for suppliers located in dense, urban locations, conduct a proximity-based risk-exposure evaluation that documents the presence of other industrial facilities near to the supplier facility, and ensure that an appropriate plan is in place to protect or relocate assets and operations if a severe industrial accident causes roadway closures, an evacuation, or public health crisis in the area.

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